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Second wave of NHS pension contribution increases unveiled

The government has published details of the pension contribution increases that nurses and other NHS staff face next year.

NHS Business Services Authority last week launched a consultation on the second phase of the government’s unpopular proposals to change the NHS Pension Scheme.

The changes are being phased over three years from 2012-13 to 2014-15. The new consultation deals with the proposed increase in staff contributions during the 2013-14 financial year.

Under the latest plans, from 1 April 2013, the contributions of staff earning between £21,176 and £26,557 will increase by 0.3 percentage points, from 6.5% to 6.8% of their salary. Those earning between £26,558 and £48,982 will see contributions increase by 1 percentage point, from 8% to 9% of their salary.

Lower paid staff earning between £15,279 and £21,175 will see contributions rise by 0.3 percentage points, from 5%       to 5.3%, and the contributions of higher paid staff earning between £48,983 and £69,931 will rise by 2.4 percentage points from      8.9% to 11.3%.

In real cash value, the increase means nurses who earn above £25,000 a year will pay around an extra £5 a month, while those who earn above £30,000 will pay an extra £20 a month. Those earning above £40,000 will contribute at least an additional £27 a month.

Unions have criticised the changes to the NHS Pension Scheme, which are being introduced while staff also face a two year pay freeze and attacks on their terms and conditions. Despite widespread anger and industrial action, unions were unable to force the government to change its policy.

The pension increases follow the government’s announcement in 2010 that it wanted to raise £2.8bn from public sector pensions by 2015.

The consultation is open to responses until 12 February 2013 via the NHS Business Services Authority website. The NHS Pension Scheme currently has around 1.3 million members.

 

2013-14 employee contributions before tax relief (gross)

Full-time pay2012-13 contribution rate (gross)2013-14 contribution rate (gross)

Contribution rate increase

(percentage points)

Up to £15,2785%5%0
£15,279 to £21,1755%5.3%0.3
£21,176 to £26,5576.5%6.8%0.3
£26,558 to £48,9828%9%1.0
£48,983 to £69,9318.9%11.3%2.4
£69,932 to £110,2739.9%12.3%2.4
Over £110,27310.9%13.3%2.4

 Source: NHS Business Services Authority

 

2013-14 contributions after tax relief (net)

Full-time pay2012-13 contribution rate net of tax relief2013-14 contribution rate net of tax reliefNet  contribution rate increase (percentage points)Additional cost (£ per month)
£10,0004%4%00
£15,0004%4%00
£20,0004%4.24% 0.244
£25,0005.2%5.44% 0.245
£30,0005.2%7.2%0.820
£40,0005.2%7.2%0.827
£60,0003.9%6.78%1.4472
£80,0004.5%7.38%1.4496
£130,0005.1%7.98%1.44156

Source: NHS Business Services Authority

Readers' comments (7)

  • ahhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhhh

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  • Is anyone surprised? Frankly, it is a smoke screen for all the mismanagement that is going on. Next stop, stopping pensions in the NHS all together then stopping state pensions with means testing for anyone who has an occupational pension. Do the politicians think we are completely stupid?? (Don't answer that as we know the answer... Yes they do!) Unfortunately we are powerless to resist.

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  • I would like to think that the huge pressure on qualified experienced nurses leaving the service would make a difference. However this government would not care, it would play into their hands to bring about the end of the NHS. When are the public going to wake up to the fact that while other countries are trying to move closer to the ideals of the NHS our service is being sold out to the private sector and profiteering shareholders. We have seen what happened with gas/electric/trains where profits come first and customers/safety last. The NHS has been heading the same way over the last couple of years. Once I thought the LibDems offered a real credible alternative to the ping pong of the other parties. It appears now that the public really need to wake up and drive real improvement in British politics.
    It would be bad enough if a reasonable pay rise was in the offing but when downgrading of posts, pay freezes and failing to replace clinical staff but employing managers and accountants in droves, they are having a joke. Bailing out bankers and making sure they keep their mates in the newspapers happy and make sure their investments stay healthy when the majority of the population are struggling to pay to get to work with rail price rises more than 2-3 times inflation.

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  • I have looked at the tables above and according to the tables I should be paying 5% pension contributions, as I work part time and my salary is less than £20000 but I have to contribute 8% as my full time equivalent is over £27000, does this mean I am entitled to full time pension!!!! I don't think so. Wage freeze for 2 years at top of my increment for years, pension age increased to 66 years, and now they want to take an extra 1% from my salary. I am so lucky to be a nurse.

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  • welcome to your new tory nhs...things WILL get a whole lot worse with this shower of idiots in charge

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  • tinkerbell

    Anonymous | 4-Dec-2012 8:07 pm

    Exactly. When you come to the realisation that 'they don't really care' then everything falls into place. Now i understand, it is a harsh reality to come to and has taken me many many years of being confused, but now i understand.

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  • I find it difficult to understand why folk on higher bands pay a greater percentage of salary... everyone gets the same end benefit so input should be the same too.

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